Yet a funny thing happened to Y2K on its way to making mayhem: Companies and governments prepared for it. When the feared date finally arrived, it was close to a nonevent.

The villain known as the fiscal cliff now has less than a month left as a media star. The fear of it will have been worse, I believe, than the passing of the thing itself. This is why investors with a long-term horizon should be looking past next month and well into 2013 to figure out how to allocate the tech portion of their stock portfolios.

Over the next few weeks, I’ll offer some perspective on several questions tech investors will face as one year ends and another begins: small stocks vs. large caps, foreign markets vs. domestic and dividend stocks vs. growth issues.

Let’s start this week with the last one on that list, offering two reasons why tech investors should consider moving more money into growth stocks for 2013.

The taxman cometh

The first reason is obvious: Regardless of where the U.S. government ends up on specific tax rates and deductions, the tax treatment of stock dividends will be soon be changing, and not for the benefit of investors.

GOP debt plan upsets conservatives

(4:23)

Conservatives take aim at House Speaker John Boehner's deficit-reduction proposal in the fiscal-cliff talks, a dispute only aggravated by decision to remove some conservatives from prized committees. (Photo: Getty Images)

Whether dividends once again get treated as ordinary income or the tax rates on them are raised, income investing will lose at least some of the edge it’s enjoyed over growth investing in the past decade.

It appears almost certain that the era of historically low rates on dividends is ending. The end comes in part because the tax cuts implemented by President George W. Bush and a Democratic-led Congress were unfortunately paired with two expensive wars that the United States must now pay for, in arrears. That bill also has come due as baby boomers line up for their Social Security and Medicare benefits.

That’s not to say investors are going to give up on income investing — not as long as bond yields flirt with negative territory, accounting for inflation, while money funds are paying consistently negative rates on that same basis.

But on a continuum of risk vs. reward, the tax and fiscal climate next year argues for a relative weighting toward higher-risk growth stocks for tech investors and away from income.

With less than four weeks left in the year, and even less time before the holiday recess in Congress, don’t look to either end of Pennsylvania Avenue for a miracle that will preserve the favorable treatment of stock dividends. Instead, amid the uncertainty, plan for what looks more certain with every passing day: higher dividend-tax rates.

The second argument for a shift away from dividends and toward growth is a technical move involving the yield curve for income stocks against the S&P 500 Index
SPX, -0.23%
as a whole. That technical trade is well explained in this column: “Melt-up begins as ‘dividendsanity’ breaks.”

Obama talks taxes for business

(1:16)

President Barack Obama addresses the Business Roundtable on raising taxes. (Photo: AP)

On MarketWatch’s Trading Deck, Michael Gayed argues in favor of fully embracing the risk that the U.S. Federal Reserve has forced onto investors, with its wildly accommodative monetary policy.

Regular readers of this column know I’m not a fan of buying near five-year highs, and the S&P 500 sits less than 100 points below those levels right now.

Remember, the true worry for tech investors back in 1999 should have been the valuations in the stock market. Given the frenzy to prepare for Y2K, not enough observers noticed the froth — until the market began dropping in early 2000 and didn’t stop for three years.

So even while the expected rise in dividend tax rates (not to mention the Fed’s encouragement of risk) supports an argument in favor of growth vs. income, value-minded investors should still pay attention to valuations.

All those factors will be affecting your portfolio well into 2013 after the phrase “fiscal cliff” fades from the headlines.

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